The audience for casual games appears to have bought, well, the farm.
Traditional gaming sites are bleeding users, as millions of Web gamers shift their time to social games, such as the massively popular FarmVille. That, coupled with an increasing desire among advertisers to move beyond old-school banner ads, has put the advertising market for online gaming very much in play, said analysts and buyers.
According to Nielsen Online, Yahoo Games has seen its audience plummet by 30 percent to 9.9 million unique users in January, versus 14 million users a year ago. Similarly, long-standing gaming destinations Pogo and AOL Games have each experienced 16 percent audience drops over the same time period. MSN Games is down to 5.3 million unique users; four years ago it exceeded 8.4 million uniques.
This slippage is being driven by Facebook users' devotion to FarmVille, Mafia Wars, Dragon Wars -- all from social gaming pioneer Zynga -- and others such as RockYou's Zoo World. Per research firm AppData, over 80 million alone have played FarmVille.
"For many people, Facebook is their home base," said comScore analyst Andrew Lipsman. "It makes sense that other online utilities and functions move there."
Plus, games are more fun when you play with your friends. "We are seeing a seismic shift happening in the quality of game play, the competitive nature that comes through the social graph," said Chris Cunningham, CEO of Appssavvy, which sells for Zynga. Zynga declined to comment for this story.
Competing for high scores on gaming sites in relative isolation suddenly seems bland, added David Madden, evp, sales, marketing and business development for the gaming distributor and seller WildTangent. "Portals don't evolve very quickly and what they are offering gamers is stale," he said. "Gamers are a communicative bunch and they go where the excitement is."
That viral nature also provides a major business advantage. "Customer acquisition costs are so low for social games," explained Bart Barden, director of online marketing for game developer PopCap. "Yahoo has to buy ads to acquire users."
Continue to next page →